Carphone Warehouse targets SMBs—Posted on June 27, 2007

The consumer broadband market is fiercely competitive, as providers compete to deliver the low cost broadband service that consumers demand. However important broadband is to a consumer, price is likely to win out over quality of service.

The business market is very different, or it has been until now. For companies, broadband is a business critical service so – whatever the size of the organisation – the service needs to be fast, reliable and secure. SMBs should be clued up about this and not be attracted by a very cheap service without knowing exactly what it would deliver – after all, you get what you pay for.

It is understandable that consumers will be tempted by a “free” broadband service from Carphone Warehouse, even with their patience being tested by delays and poor quality of service. The SMB market is less tolerant – it cannot afford not to be!

So it’s very interesting to see that Carphone Warehouse, still a new player in the broadband market, is taking an aggressive approach to targeting SMBs. It has announced that it is planning for revenue growth of 11% -12% in its business-to-business operations and that it will continue to develop its “broadband and data proposition” for the SME market.

It is no secret that the roll out of “free” broadband to Talk Talk customers has been problematic, to say the least. Of those that did not abandon the offer altogether, many are still waiting for their broadband to be up and running. Meanwhile, Carphone Warehouse continues to make a loss of £5 per Talk Talk customer as they continue to get their phone and broadband via BT Wholesale.

Carphone Warehouse has proved with Talk Talk that it cannot always deliver on the ambitious goals it sets itself and that the service it delivers is often disappointing. SMBs will be thinking twice before entrusting their business-critical network services to a player with a questionable track record in service delivery, and no apparent understanding of the unique communications needs of these types of businesses.